Wendy's takes No. 2 spot from Burger King

CANDICE CHOI
AP Food Industry WriterPublished: March 19, 2012 1:00PM

NEW YORK (AP) -- Wendy's has dethroned Burger King as the country's second biggest hamburger chain.

Wendy's edged out Burger King in U.S. sales volume for the first time last year since Wendy's was founded in 1969, according to a report by the food industry research firm Technomic Inc. that's set to be released next month.

Wendy's had sales of $8.5 billion in 2011, compared with $8.4 billion for Burger King. McDonald's remained far larger than both with $34.2 billion in sales.

The figures are based on Technomic's estimates of system-wide sales at franchise and company-owned restaurants, rather than corporate revenue, which includes fees from franchise operators. Worldwide, Burger King still has far more restaurants than Wendy's and remains the second biggest hamburger chain behind McDonald's.

Both Burger King and Wendy's have struggled in recent years to keep up with the growth of McDonald's, which has managed to keep prices low through the recession, while also introducing a new menu items and remodeling restaurants. Sales are up 26 percent in the past five years at McDonald's, up 9 percent at Wendy's and flat at Burger King, according to Technomic.

Burger King has been reevaluating its business since it was acquired by investment firm 3G Capital in 2010. The privately held company that's based in Miami recently retired its mascot "The King" last year and launched a new advertising campaign focused more on food.

Despite its edge over Burger King, Wendy's also been on a mission to reinvent itself as a higher-end hamburger chain with new items like the Dave's Hot 'N Juicy burger introduced last fall. CEO Emil Brolick, has called the Dublin, Ohio-based company's poor performance in recent years "self-inflicted wounds," also laid out plans this year to raise standards for employees and update stores with an airier, more modern look.

The sales rankings for the top five restaurant chains have undergone another dramatic shift in the past five years, according to Technomic. In 2006, the No. 2 and No. 3 spots were held by Burger King and Wendy's respectively, making the top three companies all hamburger chains.

Subway now is No. 2 with $11.4 billion in sales last year and Starbucks is No. 3 with $9.8 billion. U.S. sales at both companies have grown at a much faster rate than the top three hamburger chains, with Subway sales up 48 percent from five years ago and Starbucks sales up 39 percent.

The final Technomic report with sales for the top 500 restaurant chains is set to be released April 13.